AWEX senior market analyst Lionel Plunkett said the benchmark AWEX-Eastern Market Indicator fell by seven cents over the two days of selling, closing at 1044c/kg.
This was despite the Australian US dollar exchange rates falling 0.9 cents to US87.90 and the EMI in US cents falling 16 cents to 918.
Mr Plunkett said the total offering at Fremantle, Sydney and Melbourne fell short of the expected 50,000 bales by 2.7 percent but the 48,373 bales offering was the highest nationally in eight months.
The weak finish recorded in Fremantle during the previous auction gave a negative lead into this sale, he said.
“The market gave up ground from the outset, generally falling by 10 cents on Wednesday for most descriptions.
“Most affected were the lower spec types (part tender/high mid-break), as well as those in the 19 to 23-micron range.”
Best superfine wools go against the trend
Mr Plunkett said the finer types were assisted by good support for the better types, especially in Sydney, a designated superfine sale. Thursday followed a similar theme where there was a drop of 5-10 cents for most descriptions.
“Going against the trend was a lift in prices in the superfine range for spinners and selected best style types.”
Mr Plunkett said buyers had the largest selection of Merino skirtings in more than 12 months in which to fill their order books. But despite the large offering, prices were reasonably stable, easing a modest 10 cents clean for the sale.
“Crossbreds eased back progressively each day, closing 5 to 10 cents lower for the sale.
“Carding types consolidated last week’s gains, moving only a few cents for the sale,” Mr Plunkett said.
Buyers still trading hand-to-mouth to processors
Fox and Lillie Rural technical and marketing manager Eamon Timms said the market was fairly direction-less at the moment with not a lot of new business around and buyers are hesitant.
“There is another reasonable volume week next week, another 48,000 bales, so there is no rush.
“I think it is just a case of they bought a reasonable volume when they were buying two and three weeks ago and covered a fair amount of their needs at that point,” he said.
“And there will be a point in the next couple of weeks when they probably all get active again I would say, because what they bought then will obviously cover their needs for now.
“Because it is so hand-to-mouth they will have to come back to market reasonably soon I would guess,” he said.
Mr Timms said there was a similar pattern in demand across both selling days.
“It started very loose and then tightened as the day went on, when the indent buyers got a bit active and saw the market wasn’t going to fall out of bed they jumped in.”
Best style superfine spinner wools sell well in Sydney
Landmark wool risk manager Anthony Boatman said best and spinner-style lots sold well in Sydney’s designated Australian superfine sale on Wednesday, pushing the indicators up to five cents higher despite the lower style and strength lots attracting discounts.
“Most 18.5 micron and broader merino wool sold at levels around 5 cents under last weeks close, as buyers baulked at paying last week’s levels.
“Crossbred fleece opened sales poorly, however improved towards the end of the sale, closing soft to unchanged,” he said.
Oddments generally sold firmer to unchanged.
There was solid support held for the best and spinners styles on Thursday with gains of 5-15 cents recorded by the 18 micron and finer indicators, Mr Boatman said, but discounting continued for the high mid-break lots.
“The 18.5 and coarser categories sold at lower levels again, however losses were within 5 cents of Wednesday’s closing values for most other than the 21 and 20 micron wools, which eased back 10-15 cents.
“Crossbreds were mixed, ranging from 6 cents under, to 3 cents firmer, while oddments remained unchanged.”
Best fine wools also sold relatively firm in Melbourne
Mr Boatman said fine wool sold a few cents under last week’s levels in Melbourne’s opening sale, with the better style and strength lots maintaining support, while lower style and high mid‐breaks were discounted.
Despite a good quality offering, the medium wools suffered the brunt of the negative market conditions, with prices dropping off by 10-15 cents, he said.
He said there were some positive results for the finer crossbreds, with the limited supply of 25 and 26 micron wools selling firmer to unchanged. Coarser crossbreds eased a few cents and oddments also fell back slightly.
Mr Boatman said there were further falls on Thursday with only a select few best and spinners style lots holding firm.
“Most fine wools dropped back around 5 cents, while the medium micron wools were most affected, falling back 10 cents.
“Crossbreds made little movement, tending a few cents softer, as were the oddment categories.”
Medium wools firm during Fremantle sale
Fine wools in Fremantle continued on from last Thursday’s sale, dropping another 5-10 cents in value, Mr Boatman said.
“The medium wool offering opened poorly, however rallied towards the close of trade, ending the day unchanged or only slightly under previous levels.
“Oddments sold well, with locks and crutchings gaining 10 cents, pushing the Merino carding indicator back up to 800 cents,” he said.
“However, cardings fell back on Thursday as oddments eased up to 10 cents.”
Mr Boatman said fine wools also suffered on Thursday with prices falling 15-20 cents for the 18 and 18.5 micron wools.
“The 19 to 21 micron categories were quoted 5-10 cents lower, while the limited quantity of 22 micron wool sold a few cents firmer.”
An offering of 48,824 bales is expected next week, including a three-day Melbourne sale.
Sources: AWEX, Landmark